Matt's Trade Log - 9/19/08

Two trades today:

• Sell 1 UA OCT08 45 call
• Sell 4 SPY OCT08 130/132 vertical call spread

Finally, with the rally in SPY, I got a good opportunity to balance my SPY position with a call spread on the high side. A high VIX is making it easier to sell spreads that are pretty far out of the money, and this one appears to be quite a ways outside a near-term resistance line. Of course, with what has been happening lately, who knows. Still, I feel better about balancing out my delta, although it is still positive which doesn't really match my sentiment.

Selling the single UA call makes a diagonal out of half of my original UA position. My UA position is now long 1 UA APR09 25 call and long 1 UA OCT08/APR09 45/25 diagonal. Another way to consider the diagonal is like a covered call, but where the call is covered by another option with a longer time frame, instead of stock.